Imagine that a state government is considering the construction of a new state office building to consolidate state operations. Its estimate of the total costs and the total benefits of building a 4- 6-, 8-or 10-story building is shown in the table below. (All figures are in millions of dollars.) Total Cost Total Benefit Project (S) (S) No building 4-story building 7 8 6-story building 16 23 8-story building 24 28 10-story building 34 31 i. Compute the marginal cost and the marginal benefit of the 4-, 6-, 8-, and 10-story buildings. Should the state build a new office building? If so, what size building ii. be the totol honofit

Imagine that a state government is considering the construction of a new state office building to consolidate state operations. Its estimate of the total costs and the total benefits of building a 4- 6-, 8-or 10-story building is shown in the table below. (All figures are in millions of dollars.) Total Cost Total Benefit Project (S) (S) No building 4-story building 7 8 6-story building 16 23 8-story building 24 28 10-story building 34 31 i. Compute the marginal cost and the marginal benefit of the 4-, 6-, 8-, and 10-story buildings. Should the state build a new office building? If so, what size building ii. be the totol honofit

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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